Business

Two weeks ago, one of our favorite derivatives strategists, BofA Barnaby Martin wrote something we have said for years: "QE has been the most effective way for CBs to 'sell vol'", arguing that accommodative monetary policies across the globe amid QE have "clearly supported a strong rebound in fixed income markets." This should not be a surprise: as Martin calculated, there is now some $51 trillion at risk should rates vol spike, not to mention countless housing bubbles that have been created since the financial crisis where the bulk of middle class wealth h

Authored by Simon Black via SovereignMan.com,

First it was Pets.com, and all the unbelievably stupid Internet businesses in the 1990s.

Investors were so eager to buy dot-com stocks, all you had to do was put an “e” in front of your business or product and you’d immediately be worth millions.

It didn’t matter that most of these companies didn’t make any money. Investors kept buying.

Authored by Economic Prism's MN Gordon via Acting-Man.com,

Past the Point of No Return

Adventures in depravity are nearly always confronted with the unpleasant reality that stopping the degeneracy is much more difficult than starting it.  This realization, and the unsettling feeling that comes with it, usually surfaces just after passing the point of no return.  That’s when the cucumber has pickled over and the prospect of turning back is no longer an option.

As we've discussed frequently over the past several years, home prices in some of Australia's largest markets have gone completely vertical since 2013 as wealthy Chinese buyers have increasingly sought safe havens outside of the mainland to launder invest their cash.  Per the chart below, home prices in Melbourne have more than tripled since 2002 and Sydney is almost as bad.

Just two days ago we wrote about how, despite a budget deal signed back in July that called for a massive tax hike, Illinois' unpaid payables balance had ballooned to a new all-time record high of $16,046,145,423.20 according the comptroller's office (see: Illinois Unpaid Vendor Backlog Hits A New Record At Over $16 Billion). 

...which was a 3-fold increase over the past two years.